Clive Hale's View from the Bridge: Moral hazard or paranoia

bee

By way of Fuller Money:

"...But according to "Economics 101", quantitative easing, on the heroic scale we have witnessed thus far, should already have led to rampant if not hyper inflation. That it hasn't is down to the continuing decline in the velocity of circulation of money. In simple terms the banks aren't lending (compared with the amount of money available to them), but instead are punting on financial assets, which is where "inflation" is ending up and benefitting their balance sheets… Charles Hugh-Smith put the Fed's actions into context very well, if indelicately for some, on his recent Of Two Minds website. BoE, ECB and BoJ please take note."

Worth a read...
View from the Bridge

Old_Joe

Hi bee- excellent article in today's WSJ on the same subject. Subscription only, so no link. (Which totally pisses me off: We've subscribed to the print edition for some 30 years, but have no access to the on-line version. I'm damned if I'll pay Rupert twice for his stuff...not even a discount offered for newsprint customers. To quote Max: "Bastards!")

Anyway, the gist of the article was a thoughtful discussion on the subject, and a suggestion that maybe the so-called fiscal policies don't actually work exactly like they (University of Chicago / Austrian economic schools) had thought...